Product costs can be defined as the expenses associated with the production of goods or services. This could include raw materials, transportation costs, labour costs, manufacturing overhead, research and development expenses and marketing costs. Operating expenses are all the non-production related activities that are necessary for a business to operate. Examples include salaries and wages, rent, taxes, advertising and office supplies. Profit is the amount of money a business earns from its operations minus it’s expenses. It is the reward for taking risks, being creative and making difficult decisions in order to provide value to customers. It’s what makes business ownership worth it.